Michael Rhodes is an Intermediary Lender Banker in the Community Development Banking group of JPMorgan Chase. Commercial Observer’s Partner Insights team spoke with him about Community Development Financial Institutions (CDFIs) and loan intermediaries, and why they are so important to JPMorgan Chase’s efforts to help communities in need.

Commercial Observer Partner Insights: Give us a brief overview of your background in finance and why this was the field you wanted to pursue.

Michael Rhodes: I entered finance after working with international relief and refugee organizations. During this time, I was exposed to the fields of microfinance and community development banking, and decided that I wanted to develop financial acumen and broaden my skills.

I started my finance career in 1994 in a commercial banking training program with another employer. I have had opportunities in the United States and abroad to work in several areas of bank lending: small business, mid-market, real estate, corporate banking, and community development.

Give us a general overview of JPMorgan Chase’s Community Development Banking program.

We focus on sustainable community loans and investments. We specialize in new construction, rehabilitation and permanent financing of affordable multi-family rental housing. We offer term loans for properties with rent restrictions or grant agreements across the country. We provide financing using new markets [Tax Credit] and historic tax credit programs, and we have supported our CDFI clients.

Over the past two decades, we have provided over $ 2 billion in funding to CDFIs to support small businesses and projects, such as affordable housing, grocery stores, daycares, health care facilities and other community service operations.

Define CDFI.

A CDFI is a private financial institution engaged in community development activities serving low and moderate income communities across the United States. CDFIs provide funding and technical assistance to foster economic opportunities and community revitalization.

There is more than a thousand CDFIs in the country, made up of banks, credit unions, credit funds and venture capital funds. They serve clients who cannot meet traditional loan requirements.

Please also define intermediary loans.

Intermediary Lending is a division of JPMorgan Chase’s Community Development Banking group that provides financing, treasury solutions, and other banking products and services to community development intermediaries, primarily national and regional CDFIs. This includes No Deposit Loan Funds that finance or invest in the development of affordable housing, commercial projects, community facilities, schools, health centers and small businesses in JPMorgan Chase’s US markets.

How does CDFI relate to JPMorgan Chase’s recent $ 30 billion pledge?

JPMorgan Chase recently announced a five-year, $ 30 billion commitment to advance racial equity and provide greater economic opportunity for black and Latin communities. This commitment – which includes loans, equity and direct financing – will help promote and develop affordable housing and home ownership.

As part of this effort, we will provide more than $ 300 million in additional funding to CDFIs to support communities that do not have access to traditional funding. In addition, we will increase the number of CDFIs we work with from 25 to 45.

Why is this important to you?

I believe in people’s support. It has always been a part of me. If there are ways we can be of help, we should. I am truly grateful to be able to do this as part of my daily work.

Have you always seen yourself entering a line of work that would allow you to help people?

I did. My degree was in international relations and my focus was international development. I did this for several years before moving on to community development.

Give us an example of a time when you really got to see the positive and human results of your work.

Years ago, I visited a low income housing tax credit project in Milwaukee that our Community Development Banking team helped fund. It was in a neighborhood that had experienced significant divestment. Some residents stayed home after work to welcome us and share their new home. I enjoyed having the opportunity to provide good, solid affordable housing to the people of this community and to see the happiness it has brought them.

Talk about some of the creative ways CDFI and related programs stepped up during the pandemic to help communities in need.

The pandemic started as a health crisis, but then gained momentum and turned into an economic crisis with job losses, business closures, and loss of wealth and services in many. communities.

CDFIs are designed to meet these specific challenges. They launched awareness efforts in their portfolios with the message “How can we help?” They provided interim payment relief and loan modifications. They have put in place short-term emergency credit facilities for working capital and targeted loan funds to help sectors with the greatest impact.

CDFIs have also engaged directly in the paycheck protection program, ensuring that funds are directed to businesses and organizations in low- and middle-income communities. In the longer term, the CDFIs create and develop programs and funding mechanisms to promote sustainable, sustainable, economic and community development.

Give me an example of a specific project that you are proud of.

Last year, we provided $ 50 million in low-cost, long-term capital to the Grow America Fund (GAF), a CDFI that is part of the National Development Council, a national non-profit economic development organization that has been making small business loans for over 25 years. years. The funding supported GAF’s participation in the Paycheck Protection Program. With our support, GAF has made around 700 loans to small businesses, saving around 10,300 jobs.

Now that the end of the pandemic may be in sight, how will the future affect CDFIs and their functioning in these communities?

I anticipate that in the future, the work of CDFIs will expand and intensify. There will be late effects, especially in low and middle income communities, and a prolonged recovery. CDFIs will engage in increased and targeted efforts to address the legacy of the pandemic and promote recovery.